A recent study into the future of legal funding resulted in several interesting insights. These include potential market growth, use of funding by corporates, expense, and strategic input into cases.
An LFJ Conversation with Michael Kelley, Partner, Parker Poe
A recent study into the future of legal funding resulted in several interesting insights. These include potential market growth, use of funding by corporates, expense, and strategic input into cases.
Alix Partners explains that between 2017 and the end of 2019, assets held by litigation funders in the UK increased 46%. When surveyed, however, more than 90% of respondents say they expect funding to increase in use and expand the types of cases it is used for.
Roughly 15% of in-house counsel surveyed have used litigation funding. Private practice solicitors and barristers are more likely to have used it, or worked with those who have used it. Some corporates haven’t used funding because they say they don’t need it. But is that accurate? Or could companies be missing out on the benefits of legal funding because they don’t know how to best utilize it? That is especially possible, given how many misconceptions there still are about third-party funding.
Funding your own litigation makes sense if you win—but taking a sizable risk with your own assets is just that—a sizable risk. Betting on a sure thing is nice, but funding allows corporates to take a chance on a less predictable case without risking assets.
Working with a funding entity also provides legal expertise from a third party. This can help with strategy, evaluation, and more—yet this is rarely touted as an obvious benefit of the practice.
